Bank note printer De La Rue is set to increase its North East workforce after the firm announced the proposed closure of its banknote production operations in Malta.

The firm, the world’s largest commercial banknote printer and commercial passport manufacturer, has carried out a review of its manufacturing footprint, resulting in a series of potential changes across its global bases which affect some 400 jobs in all.

The Gateshead base’s security print capability is set to be relocated to Malta – but the Tyneside base is poised to become one of three centres of excellence, the others being based in Kenya and Sri Lanka.

As a result, the three centres will see their banknote production levels increase as they take on the work which has been carried out in Malta.

De La Rue has said the overall restructuring will affect around 400 jobs , but stressed the proposals are under consultation.

Out of the jobs affected, roughly 300 will be at risk of redundancy, with the affected employees being based mainly in Malta, but a spokesman for the business said Gateshead will not see any job losses, and will see a small net increase of less than 10 roles.

Employing nearly 4,000 people – including 550 in the North East – De La Rue produces a wide range of other security products alongside its passport and currency contracts, and also offers specialist services and software solutions.

In a trading update, the company said it had made good early progress on the delivery of a five year strategic plan.

“The group is seeking to maintain its leading position in the commercial banknote market by optimising its manufacturing footprint to deliver the right capability, capacity and cost base,” it said in a trading update.

“It plans to invest less than £30m. The majority of the investment will be used to replace and modernise existing print equipment over the next two years and to reduce the number of production lines from eight to four.

“This will reduce core production capacity from current 8bn to 6bn banknotes a year, with ability to flex up to 7bn through built in flexibility.

“Volumes in excess of 7bn notes will be achieved through external partnerships.

“Banknote production will be consolidated into three centres for excellence.”

The group would also seek to accelerate its growth in the identity and security products markets by improving capabilities and investing in new technologies.

“A significant portion of the overall £30m capital investment will be invested in equipment and skills to create a centre of excellence for identity and security print at De La Rue’s current site in Malta,” the update said.

“This will enhance further the group’s identity and security print capability and give the group a competitive edge to capture the high growth opportunities in the markets.”

The restructuring is expected to generate in excess of £13m annual cost savings from 2018/19 in addition to existing cost-saving initiatives.

A formal consultation with affected employees is now under way.

Chief executive of De La Rue, Martin Sutherland, said: “As the leading commercial designer and printer of banknotes and passports, our manufacturing footprint review has identified significant opportunities for improvements in capability and efficiency.

“We are announcing plans to achieve a more streamlined De La Rue, in line with the future needs of our global customers, focused on centres for excellence with investment that underpins our future.”